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Claude Resources CEO Discusses Q2 2012 Results - Earnings Call Transcript

Revenue was up in the quarter, obviously the higher gold price helped quite a bit. Again, cash costs have been frustratingly high. It's predominantly a function, probably 50/50 of the lower grade and then higher labor and consumable rates that we are all facing in the industry but again, notwithstanding, that 12,000 ounce number, we expect to see increase. We were profitable and did generate reasonable cash flow during the quarter.

Gold production, as I said, was just over 12,000. We sold 12,300 ounces. Net profit was modest but again it gives you an idea about what we can accomplish going forward as production increases.

On page six, if you are following on our chart, we have been getting questions about our balance sheet. At the end of the quarter, we were negative $1.6 million in cash. We did have a line of credit available. Short term debt increased substantially and long term debt went down substantially during the quarter and the reason for that is our $10 million, or $9.8 million debenture which matures in May of 2013 became a current liability because it is under one year to maturity. So it moved up the long term debt in to short term debt.

As well, in the short term debt, we have about $9 million worth of just under that equipment lease or equipment financing at the Seabee operation, where we used to lease that equipment. We have converted that to a fixed term debt and the fact that it's got gold provisions on it, means that we have to include it in short term liabilities as well, although we don’t have any expectation that that debt would be called.

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